What retailers need to know about marketing and selling ready-to-drink beverages

Ready-to-drink (RTD) cocktails are positioned for growth, driven by innovation and consumers’ desire for high-quality, highly portable cocktails. Even though growth spiked during COVID-19 lockdowns, as consumers have returned to bars and restaurants, the demand for RTDs has not slowed down.  This presents a great opportunity for the off-premise retail channel, so we asked Scott Moore, Southern Glazer’s Senior Vice President, National Accounts – Off Premise, what his team has learned about how consumers are shopping for and consuming RTD brands.


SGWS: Scott, tell us what you know about the RTD consumer.


Scott: Once focused primarily on a younger market, now, thanks in part to a shift in premium offerings, the consumer demographic is split between all legal drinking age groups.  Forty-nine percent these consumers earn $100,000 or more per year. RTD's continue to deliver on some of the most important attributes consumers are looking for including convenience, “better for you” wellness offerings, and lastly, authenticity and flavor.


SGWS: What trends are you seeing related to purchasing behaviors?


Scott: Overall, consumers are reacting to flavor, convenience, and pack size. At times, the RTD purchaser is the shopper and not the final consumer, so they are buying multiple categories together. Two-thirds of ready-to-drink cocktail shoppers also purchase another type of alcohol. When canned cocktails are in the basket with red wine, white wine, or spirits, the purchase will generally be more than $100.00. We also see RTD’s delivering on unique and emerging flavors such as lemonade, tea, and punch, along with traditional offerings such as margaritas, palomas and vodka-soda.


SGWS: What about consumption habits?


Scott: This is an extremely important category and is growing at a rapid pace, with nearly 47% of all adult beverage buyers purchasing some form of a ready-to-drink products. Today we see that 50% of consumption occurs on the day of purchase, and 66% of consumption occurs at home in some kind of gathering.  Consumers are exploratory, and as such, innovation is extremely important in fueling growth and contributing to nearly 20% of all the RTD sales, compared to 4.3% in total adult beverage.


SGWS: So, what does all of this mean to a retailer in terms of in-store selection and merchandising?


Scott: There are definitely things retailers can do to maximize RTD purchases in their stores. For example, 89% of consumers prefer their canned cocktail purchase to be cold. In fact, if the product is cold, they will spend 30% more.  Also, 50% of purchases are impulse purchases. So, retailers need to make it easy for the consumer to find, with highly visible displays and positioning product in the front of the store. Also, it’s important to have all alcohol base variety products represented – that means canned wine, seltzers and RTDs. The more options the better.


SGWS: How should retailers look at marketing RTDs differently than other traditional beverage alcohol formats?


Scott: When marketing to RTD's and canned cocktails, it's important to remember that customers like options. Mix in different flavors, base spirits, and include variety packs. Products like Bacardi, High Noon, The Long Drink, Crown Royal, and Mamitas, shelved and promoted together, give customers a lot of options and encourage multiple purchases. All the data we've looked at shows that hard seltzers and RTD spirits are poised for increased growth in the upcoming year. Lastly, we must not forget e-commerce, as RTD’s are increasing their online presence and have seen a 15% increase in total dollars spent in that category.


Mix up your offering and shop Proof® for our spirited RTDs here.